Independent suppliers need to maximize existing businesses while embracing the new digital marketplace, said keynote speaker Bill Sondheim, president of the Cinedigm Entertainment Group, during his “State of the Industry” keynote presentation at the Los Angeles Entertainment Summit July 17.
The LAES event, held at the Loews Hollywood July 17-18, is presented by the Entertainment Merchants Association.
While “DVD and the physical formats in general will not be the longtime revenue drivers we’ve all enjoyed over the last 25 years,” he noted that there are “large demographics” that still like the medium because it is familiar, easy to use and affordable.
Therefore, he said, “I think it would be foolish” to abandon the segment prematurely,” he cautioned. In fact, Cinedigm’s disc business, which had experienced declines, flattened in 2017 and is now growing in 2018, in part due to smarter retail placement, interest in 4K Ultra HD, mult-pack sets and specially packaged products, he said.
Still, digital distribution is the “revenue engine” going forward, “and unlike its physical predecessor it’s taking many shapes and sizes, due in part to its more consumer-responsive nature.”
“I often say digital is the democratization of entertainment consumption,” he said. “Content distributors, retail shelves, they no longer decide what wins. The omnipresent availability of digital content anywhere and everywhere allows the consumer to be in charge.”
With digital content available through EST, transactional VOD and subscription streaming, he said, content owners need to find consumers on the platforms and services they like. That’s why Cinedigm was early in embracing the OTT market and created three OTT channels.
“You need to be platform agnostic,” he said. “Confidently follow the money regardless of the platform.”
He added, “Tech is playing an increasingly role in content distribution. It’s no longer entirely accurate to say content is king.”
In that same vein, data is key.
“We put a great deal of focus and investment in securing extensive and detailed data,” he said. “And we have a strong culture of analytics and self-reflection. Cinedigm looks at each piece of content to determine the right demographics. It starts and ends with the consumer.
“And once we’ve determined who will want a particular piece of content, then we determine where that consumer shops. That could mean Walmart or Best Buy, but it can also mean Netflix or Amazon or iTunes or even something more unique, like Crunchyroll.”
Noting that there were “no major studios or retailers” in the audience, Sondheim pointed out that indies are critical innovators. They “take chances on innovative content,” he said.